Voting Pools: How to Stop the Plague of Bitcoin Heists, Thefts, Hacks, Scams, and Losses

News, Regulation, Trending December 13, 2013 , by admin Comments Off 123

The following is a small portion of the blog posted by Justus Ranvier that recounts Bitcoin losses. Link to the complete story to see the full study and proposed remedy.

In July of 2011, the owners of popular web wallet service and payment processor MyBitcoin.com absconded with all customer funds, almost 79 thousand bitcoins, and disappeared.

In March of 2012, several sites hosted with Linode were hacked, including leveraged trading platform Bitcoinica, mining pool Bitcoin.cz, Bitcoin Faucet, and several other sites. A total of about 47 thousand bitcoins were lost.

Two months later, Bitcoinica was hacked again and lost another 19 thousand bitcoins, causing it to shut down.

Two months after that, someone stole 40 thousand bitcoins from Bitcoinica’s Mt Gox account, 30% of their remaining assets.

In September of 2012, exchange platform Bitfloor was hacked and lost about 24 thousand customer bitcoins.

In October 2013, Silk Road users lost 172 thousand bitcoins when they were seized by the FBI.

The months of November and December 2013 have been particularly bad in terms of Bitcoin companies losing funds to theft, with Inputs.io, BIPS, Bidextreme all reporting losses.

In virtually every case of companies losing customer funds, it’s difficult or impossible to disprove that an inside job was responsible.

via Bitcoinism.